Best Payment Gateways In India For Small BusinessesPin

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If you are planning to start an online store for selling or drop shipping different types of physical & digital products, then you’ll need an online payment gateway to receive money from your customers.

Before a few years, setting a payment gateway and integrating it with a website was quite a difficult task. You might need a lot of documentation for the tedious business verification process, huge setup & maintenance fees, and most importantly technical brain to make it work or seeking the help of an expert developer.

But now, this all has changed and you can set up an online payment gateway very easily using the DIY approach with a little technical knowledge.

You already know there are a number of online payment gateways and millions of people are using these services in their day-to-day life to shop online products.

Payment gateways are useful for merchants too. Once setup & legal formalities are completed, the merchants/sellers can receive the payments directly into their bank accounts and all transactions are listed at the single place. It also becomes easy to track the payments and no extra paperwork required.

It doesn’t matter whether you are a small seller or an e-commerce business giant or even the end-user buying the product or service. The online payment systems serve their purpose very well.

It is also helpful to bloggers, web designers, and online marketers to receive their payment without any hassle.

The digital marketing industry is growing continuously day by day.

Today, most countries support digital money and it can be easily converted to different currencies through online payment services.

That’s why people prefer online payment gateway system over traditional cash and cheques.

Earlier, most of the sellers as well as buyers wary of online payment processing services due to potential hassles such as frauds and theft.

However, online payment service has become the need of the hour due to due to some notable features, including fast transactions, support for multiple currencies, security concerns, real-time tracking and much more.

Every system has its pros and cons.  Among all of the payment services, online payment gateway is the best choice, especially for businesses.

How to Choose the Best Payment Gateways in India

When you search for the best payment gateway in India, you’ll see tons of results in the Google SERP for your query including different opinions from the industry influencers and real users.

The major payment gateway services in India include CCavenue, Paytm, EBS, RazorPay, CitrusPay, Instamojo and some of the biggest payment processing companies such as PayPal and Payoneer, that are working globally in more than 200 countries.

Each of these online payment processing services has its own business strategy but you need to consider 10 important things mentioned below while selecting an online payment gateway for your eCommerce business.

  1. Market reputation and review from real customers.
  2. Required documentation for onboarding.
  3. Time to set up everything before you actually start receiving payments.
  4. Payment gateway fees (Charges including the setup fee, TDR, and annual maintenance fee).
  5. Available payment options (Credit/Debit Cards, Netbanking, UPI, and Mobile Wallets).
  6. UI of the payment gateway dashboard and overall user experience as a merchant/seller/business, including the speed of the transaction.
  7. Availability for domestic and international payments.
  8. After-sales Service and Prompt Customer Support.
  9. Development features, including APIs, Mobile SDKs, and different codes/key support for external integration.
  10. Extra features, including buyer’s protection/seller’s protection, enhanced security, hosted eCommerce store (Instamojo).

For my agency website where I sell web design & digital marketing service, I was searching for the best online payment gateways to receive funds from my clients.

And, I found a few payment gateways in India with no setup fees and have a reliable online payment processing operation.

I have listed the top online payment gateways in India for small businesses that are easy to set up and do not charge any setup fees or annual maintenance fees.

In terms of the safety of transactions, commission rates, and the overall features, the following online payment services definitely secure a place on our list.

7 Best Payment Gateways in India for Small Businesses

1. Paypal

Payment Gateway: PayPal

Setup Fees: Zero

Annual Maintenance Fees: Zero

Transaction Fees: Up to 4.4% + Fixed Fee Based on the Currency.

Paypal is one of the best online payment gateways for your business as well as personal transactions. It is a very secure solution to send or receive money.

PayPal was founded in December 1998 and now it is one of the largest online payment gateways for small businesses.

It has a good reputation in the market for online money transfer.

in fact, PayPal seems a good alternative to a traditional paper currency like banknotes and cheques.

In terms of features, it provides a superior solution for money transfer in a very secure way.

Although some cases of scams have happened, still it is one of the most trusted online payment services in India as well as in the world.

The transaction charges are flat 4.4% + fixed fee and can reduce up to 2.9% + fixed fee for the larger volume.

It does not charge a single penny as a fee while the purchase. The annual account maintenance charges, setup fee, and monthly charges are also waived off.

You have to pay, only when you receive payments and, it directly transferred to your bank account linked to it (It may take some time to transfer funds to your account).

How Does PayPal Work?

PayPal Online Payment ServicePin
PayPal Online Payment Service

When you sign up for PayPal, it gives the option to link your local bank, mobile number, and debit/credit card. However, the primary Email ID of your account is used for receiving funds.

It can store funds in your PayPal account itself but not supported in all countries like India due to Government regulations.

You have to share your PayPal email ID (or merchant ID for more secure transactions) to send & receive payments. Even you can shop with PayPal money. It gives another option to sell kinds of stuff on eBay for lesser transaction rates.

PayPal also supports a wide range of currencies which makes it easy to use in a worldwide situation.

2. Payoneer

Payment Gateway: Payoneer

Setup Fees: Zero

Annual Maintenance Fees: Zero

Transaction Fees: Up to 3% + Bank Charges If Any.

Payoneer is an international payment gateway established in 2005.

Currently, it provides online money transfer and refillable debit card service in more than 200 countries and 150 currencies.  The transaction rates are less than the PayPal and variable according to the currency that you use.

It does not charge you anything when you purchase or send money through Payoneer.

The fee structure has made by keeping everything in mind and suitable for everyone.

If you try to compare PayPal and Payoneer, you won’t find much difference, though transaction rates of Payoneer are lesser than that of PayPal.

How Does Payoneer Work?

Payoneer Online Payment ServicePin
Payoneer Online Payment Service

Payoneer a cross-border payment gateway beneficial for receiving funds especially from the US and EU. When you sign up for a Payoneer, it will link to your local bank account.

However, if you want to receive payments from international clients, Payoneer will give you a bank account for ACH in the US and SEPA in the EU.

It helps to do your business locally as well as internationally with the same efficiency. The benefit of this service is that you won’t lose in currency conversion when receiving payments from these countries.

Apart from transaction fees, it charges 2-2.75% to withdraw funds in your local account. All details are shared on your dashboard.

Another advantage of choosing Payoneer is that the association with the Mastercard and you can get Payoneer Prepaid Mastercard for easier and convenient fund withdrawal or buy a product or service on a global level. You can get the Mastercard currency converter tool to check your transaction fees.

It provides a cap of 5 lac for the single transaction and withdrawal for the single business day. The cap grows up to 25 lac for a calendar month.

The payments exceeded that limit will be rejected.

If you are receiving money from overseas clients, Payoneer will give the edge over PayPal, especially when you are receiving from the US or EU.

You can earn $25 for the Sign up for Payoneer. And, the interesting thing is that it’s free.

3. PayUMoney

Payment Gateway: PayUMoney

Setup Fees: Zero

Annual Maintenance Fees: Zero

Transaction Fees: Flat 2% + GST

In this list, the PayUMoney also a game-changer when we talk about online payment gateways for India.

PayUMoney provides a faster and secure transfer of funds with 128-bit SSL encryption and PCI DSS level 1.

It has a community of more than 2.5 lacs active sellers who are happy with its services.

The reasons are simple.

PayUMoney charges a flat 2% only for all transaction that is very less as compared to other payment gateway solutions.

Apart from that, it adds 1% extra only on AMEX cards.

It does not charge any setup fee or annual maintenance fee. So it is growing at very rapid rates.

The mobile-friendly versions and login free check out with the support of more than 125 banks and cards make it harder to beat by the competition.

Faster account activation and even faster settlement make it amazing.

It also features free billing software for your phone that lets you create bills and collect payments.

It also provides the HTML code for the ‘PAY’ button to receive money on your website.

Card Swipe Machine

card swipe machine Pin

PayUMoney provides the card swipe machine for its sellers with minimum documents (PAN and a canceled cheque). You can link it to an existing bank account also.

The wireless card swipe machine can access any type of debit/ credit card and anywhere in India and gives full access to your transactions. Being eco-friendly it does not use paper and sends the receipt to the buyer’s mobile number. Smart huh?

It costs only Rs. 8500 that is very less price and no monthly or yearly premium. TDR also set up 2% less. You are a smart seller and I’m sure that you won’t miss this deal.

Even if you haven’t taken the decision, it’s time to roll on.

Sign up here for PayUMoney now!

4. Paytm

Payment Gateway: Paytm

Setup Fees: Zero

Annual Maintenance Fees: Zero

Transaction Fees: Up to 1.99% + GST

When we think about the mobile payment solution no one misses out the word Paytm. It is one of the leading mobile payment solutions with the e-wallet feature.

Easy to set up and simple to use even by a rookie. Paytm has integrated with most of the brands as the online payment gateway.

It also provides money transfer solution with the zero setup fee and annual maintenance. The transaction rates are also set up to 1.99% (+ service tax).

Even Paytm payment gateway comes with the deal with the zero fees for the first 3 months (or gross transaction of 2 lacs, whichever is earlier).

It is a very popular payment gateway in India for small businesses and thousands of sellers have Paytm merchant account.

I’m sure that you have been Paytm as a buyer for many days, but it’s time to use Paytm as a seller or business.

Don’t miss this deal.

Sign up here for the free Paytm Business account.

5. 2Checkout

Payment Gateway: 2Checkout

Setup Fees: Zero

Annual Maintenance Fees: Zero

Transaction Fees: up to 6% + $0.60 Per Successful Sale

It is also one of the trusted online payment gateways with no monthly charges or setup fees. The transaction rates may differ by up to 5% according to the country and currency used.

It provides cross-border payments also with a very less fee of 1.5% for that. It features flexible payment methods with debit/credit cards and PayPal also.

Moreover, it let you receive payments by bank transfer, international wire transfer, and even on Payoneer Mastercard too.

It is one of the options for the online payment gateway and really amazing. Easy to start and see your business growing rapidly.

If you want to check it out, Sign up here for the free 2Checkout seller account.

6. Razorpay

Payment Gateway: Razorpay

Setup Fees: Zero

Annual Maintenance Fees: Zero

Transaction Fees: Up to 3% + GST

Razorpay is an excellent payment gateway in India that allows merchants to send and receive payments with its product suite.

You can accept the payment through various modes, including the credit/debit card, UPI, net banking, and popular wallets such as JioMoney, Mobikwik, and FreeCharge.

It also offers automated recurring payment for different subscription services and Razorpay’s Smart Collect feature allows users to easily collect payments via direct bank transfer methods (NEFT/RTGS/IMPS) as well as automate the tedious reconciliation process.

For the people who don’t have a website, Razorpay has developed the payment links. You can share these links via SMS, emails, social media, and chatbot, etc. to get paid immediately.

Invoicing is another great feature in Razorpay. It will help you to build trust with your clients when you share detailed expenses over the invoices to get paid faster by letting them pay online from the invoice itself.

For setup and annual maintenance of your online payment gateway account, it does not charge a single penny. You only need to pay the transaction fees.

Razorpay payment gateway charges only 2% per transaction for the domestic/Indian card payments, Netbanking, UPI and mobile wallets.

3% per transaction charges + GST on the transaction fees are applied for Dinner/Amex cards, EMI and international cards.

For enterprise levels, you can ask for custom pricing and Razorpay will definitely help to match your business needs.

7. Instamojo

Payment Gateway: Instamojo

Setup Fees: Zero

Annual Maintenance Fees: Zero

Transaction Fees: 2%+ ₹3 for each transaction for regular payments and 5%+ ₹3 for the hosted digital products.

Initially, I had a very bad experience with Instamojo service for the KYC documents verification process.

They simply told me that my business is not compliant with their service and closed my account without leaving any option behind.

I used to advise my peers if someone wants to join them, he should clear the doubt about the KYC verification and business integration process before signing up for the Instamojo.

Nowadays, Instamojo has improved its online payment gateway service and you can expect a nice performance as one of the leading e-commerce payment solutions.

It offers the simple and easy to follow user interface and the lots of features like social pay, store for physical as well as digital goods (You can store your digital files on their server).

It charges 2% + ₹3 for each transaction while 5% + ₹3 for the hosted digital goods. It has also waived off other payment gateways charges, including setup fees and annual maintenance fees.

If you want to know more about it, click here to read a complete Instamojo review.

If you haven’t used Instamojo before, you can now create a new account and start accepting the payments from your customers.

Exclusive Offer

When you complete the KYC/business verification process and receive the first valid payment on Instamojo, you will be rewarded with ₹500 as the signup bonus.

[Use reference code ANKIT_MAINf564 when asked].

Instamojo referral link & referral codePin


1. What is payment gateway?

Payment gateway is an online payment services that connects and authorizes your bank account to the platform where you want to transfer money such as e-commerce website, online retailers, or POS.

2. What are the payment gateways in India?

Instamojo, Razorpay, CCAvenue, 2Checkout, PayPal, PayUMoney are a few top payment gateways in India for small businesses.

3. Which is the cheapest payment gateway?

Instamojo, PayUMoney, and Razorpay are the cheapest payment gateways in India with no setup fees or annual maintenance fees.

4. How much does a payment gateway cost in India?

Usually, payment gateway charges in India varies between 1.75% to 6% based on the currency and transaction amount. GST will be applicable on the transaction fees.

5. How do I integrate a payment gateway?

Most payment gateway comapnies offer APIs, SDKs, and developer tools so that you easily integrate a payment gateway in your website or app.


I have found these online payment gateways, the best suited for any e-commerce business from the beginner to the established brands too.

The payment gateway companies listed above have tied up with many big companies, including Amazon, Flipkart, Snapdeal, DishTV, MakeMyTrip, Jabong, eBay and e-commerce platforms such as Shopify, Magneto, and WooCommerce.

Make sure to read their TOS and Privacy Policy again, before moving ahead.

If you like this article don’t forget to share it with your peers.

In case, you have any feedback or want to add another payment gateway service, feel free to connect in the comment box below.

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One Comment

  1. Hi Ankit, Nice Post .

    The Payment Service providers listed above are a great option in case if it is for a low risk industry. Almost all the above mentioned providers are not comfortable with High Risk Businesses . I would suggest you to recommend some High Risk Merchant Account providers as well.

    Also it will be great if you introduce Check21 Solution to the merchants as it can be very helpful if the buyers are located in the United States.

    The Risk is calculated by the Payment service Provider by keeping many things in mind

    The % of Returns
    The % of Charge-backs
    The Financial Stability of the Merchant
    The Delivery Time Frame of the Product and Services
    The Geo Location difference between the buyer and the seller.

    Best Wishes and Happy blogging . I will be glag to contribute to this page .

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